Mortgage Banking and Cows, and Barn Doors and Stuff

by Alex Stenback on December 18, 2007

First, from Today’s NYT, which lays blame on Federal Regulators for letting the cows out of the Barn:

An examination of regulatory decisions shows that the Federal Reserve and other agencies waited until it was too late before trying to tame the industry’s excesses. Both the Fed and the Bush administration placed a higher priority on promoting “financial innovation” and what President Bush has called the “ownership society.”

Second, from the WSJ on the Fed’s proposed method of shutting the barn door:

The Federal Reserve on Tuesday is set to consider a plan that would mark the central bank’s biggest regulatory response to date of the country’s mortgage turmoil.

The staff proposal under review would curb the types of subprime products lenders can offer, prohibit certain misleading disclosures, and limit the compensation of mortgage brokers.

The press release and details Fed proposal are here, for those so inclined. 
Fed Proposes New Mortgage Rules… [WSJ]
Fed Shrugged as Subprime Crisis Spread [NYT]

{ 3 comments… read them below or add one }

PeterT December 18, 2007 at 6:01 pm

Alex, In the great minds think alike department, I posted on the same theme today.

John Hoff December 19, 2007 at 2:58 pm

Sounds like due to this mortgage crisis we are seeing the VERY OPPOSITE of an “ownership society.”

Like, “These are MY COPPER PIPES and that there is MY SINK AND TOILET. Why? Well, because they’re in the back of MY TRUCK, so I own them and they are MINE.”

There’s your Bush “ownership society” on the North Side of Minneapolis.

Tim Foster December 26, 2007 at 10:59 pm

[…]Unfair and deceptive practices have harmed consumers and the integrity of the home mortgage market,I agree

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